AI Servers Are Turning Memory into a Core Capital Expenditure
On August 26, Micron's stock price fluctuated around $940, approaching the lower boundary of its rising channel. Cloud service providers continue to build AI infrastructure, driving simultaneous demand for server DRAM, enterprise SSDs, and HBM. TrendForce estimates that even with long-term agreements setting price ceilings, HBM contract prices could still rise by 70% to 140% by 2027.
Research data indicates that memory could account for up to 68% of cloud service providers' capital expenditures. AI servers' demand for HBM capacity and speed far exceeds that of traditional servers. Suppliers are also shifting more wafer capacity to more profitable server products, tightening supply in the general DRAM and NAND markets.
Stock Price at a Critical Directional Decision Point
From a technical perspective, Micron remains inside a rising channel, but the area near $940 is close to the channel's lower boundary. $935.35 is a short-term support level that needs to hold. A break below this level could lead to a retest of lower channel support, weakening the previous rebound structure.
The $996.35 level above is a key Fibonacci resistance. If the stock price breaks through and holds above this level on strong volume, the rebound momentum could accelerate again, with the next target looking at $1057.35. In other words, there is upside potential, but the bulls need to prove that the consolidation near $940 represents a phase of accumulation rather than distribution at a high level.
HBM Boom Still Requires Caution for a Cycle Reversal
The bullish thesis is based on sustained growth in HBM prices, the number of AI servers, and enterprise SSD revenue. Micron's limited supply in advanced memory segments enhances its pricing power. However, the semiconductor industry is inherently cyclical. If cloud service providers cut capital expenditures, competitors ramp up capacity, or customers start pushing back on prices, the current high-growth expectations could quickly correct.
The original trading framework is very clear: above $935.35, the rising channel remains valid; a break above $996.35 sets the target at $1057.35; if $935.35 is lost, caution is warranted for a pullback to the channel's lower boundary. For momentum buyers, long-term HBM demand is the foundation, but a successful break above $996 is the key short-term confirmation signal.
